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USA Online Gambling Bill Being Attached To Tax Proposal

12/8/10 - Posted By Peter Blackhouse :

Is Senator Reid about to use an old political trick to get legalised internet poker through Congress?
 
There's a sense of deja vu around the news that an attempt by Senator Harry Reid to legalise US online poker may depend on attaching the bill to other must-pass legislation before Congress quits its 2010 session.
 
Republican politicians used just such a tactic in ramming the Unlawful Internet Gambling Enforcement Act through a late night session of Congress four years ago, attached to a security bill.
 
The news that Senator Reid may be about to deploy a similar stratagem, this time to legalise internet poker, was broken by the respected Washington DC publication  Politico this week, which reported that Senate Majority Leader Reid is trying to use the tax cut package President Barack Obama brokered with Republicans to get his legalisation bill through.
 
Politico opines that such a move could further complicate the deal Obama announced Monday.
 
Reid is backed by major US land casino interest in his attempt, according to the American media, where the legalisation story has attracted massive coverage.
 
Approached by Politico for comment, Reid, who has previously opposed online gambling, declined to comment Monday.
 
The publication says that Republican Sen. Orrin Hatch of Utah, together with other knowledgeable Washington insiders, has confirmed that Reid and his staff have been lobbying support for the new Reid bill to be attached to a measure extending the Bush-era tax cuts.
 
Hatch, who is expected next year to be the senior Republican on the Senate Finance Committee, told Politico: "They're trying. Sen. Reid would like to do that."
 
Another senior congressional official with knowledge of the ongoing tax negotiations claimed that Reid has privately discussed the measure with the two Republican senators representing the GOP's caucus in the negotiations - Senate Minority Leader Mitch McConnell of Kentucky and Sen. Jon Kyl of Arizona. However, the latter, who has a history of implacably opposing internet gambling, told Politico that he intends to block Reid’s proposal, vowing:  "There is zero chance — no chance whatsoever that would be part of the tax deal. I don’t think it would be the right thing to do.”
 
Other Democrats warned that the addition of the legalisation bill to a tax relief bill for upper bracket earners that is already less than popular with many representatives could be counter-productive. They warned that the White House has work to do to rally support within Obama's own party for the tax package itself, let alone if it included special-interest gambling legislation.
 
Republicans are also expected to accuse Reid of being engaged in a pay-back to the US gambling industry for its support for his re-election in the recent mid-terms.  Harrah's and MGM Mirage were among the biggest contributors to Reid's campaign. Politico also reports that the two casino companies combined to contribute at least $375,000 to Patriot Majority, an independent political group that spent more than $3.3 million attacking Angle, whose down-to-the-wire campaign against Reid was fueled with millions of dollars. Reid and Angle spent more than $41 million between them, making their Senate race the second-most-expensive contest, according to the Center for Responsive Politics.
 
Answering the allegations, Jan Jones, Caesars Entertainment’s top lobbyist, told Politico that other casino interests also support the legalisation of online poker, adding that it would be inaccurate to describe Reid’s legislation as a sweetheart deal in exchange for the casino’s support during his reelection campaign.
 
“It has industry support ... and [is] not a payback,” Jones wrote in an email to the publication.
 
More opposition to the Reid bill is anticipated from the National Indian Gaming Association, which reportedly feels that the proposal gives an advantage to Las Vegas-based gambling operators while discriminating against tribal operators.
 
“It is drafted to create an initial regulatory monopoly for Nevada and New Jersey for the first several years of the bill, which gives Las Vegas operators time to capture the market,” a spokesman claimed when approached by Politico. The American Gaming Association, which for the last two years has adopted a neutral stance on internet gambling, declined to comment, and opinions among the giant casino groups in its membership appear divided, with some supporting Reid strongly and others concerned about provisions in the bill that could allow companies that previously operated in violation of online gambling laws to enter the legalised online gambling market.

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